Counties face tightened oversight as Controller of Budget gains access to bank accounts

County governments will now face heightened scrutiny after the Controller of Budget Margaret Nyakang’o was granted legal access to thousands of bank accounts held in commercial banks, a move aimed at sealing loopholes that have enabled misuse of public funds.

This follows the implementation of the County Public Finance Laws (Amendment) Act 2025, which gives her office the right to view all transactions made through county government accounts.

The reform introduces a new layer of oversight over county finances, allowing the budget controller to track cash movements and flag questionable activities.

For years, counties have operated numerous accounts in commercial banks, despite regulations requiring them to keep their funds at the Central Bank of Kenya.

By June 2025, they were running 5,476 commercial bank accounts, more than double the 2,028 recorded the previous year raising alarm over the potential misuse of taxpayers’ money.

These accounts are mainly used for county-established funds, operations, and salary payments.

However, lax controls have made them vulnerable to abuse by officials diverting funds outside the Controller of Budget’s oversight.

“The Controller of Budget shall have viewer rights access to all bank accounts maintained by the county executive, county assembly, and all other county government entities,” reads part of the amended law.

Counties have often failed to comply with rules that require them to seek clearance from the Controller of Budget before opening new accounts.

The Public Finance Management (County Governments) Regulations, 2015 only allow commercial bank accounts for revenue collection and petty cash, but the growing number has attracted concern from oversight offices.

Homa Bay leads with 558 commercial bank accounts, followed by Kitui with 350, Nakuru at 311, Bungoma with 301, and Baringo with 280.

The lack of transparency in handling public finances has worsened cash flow challenges, causing delays in essential services, including healthcare.

Nyakang’o has been vocal in recent months about the need to rein in the ballooning number of accounts, saying that access to their records will strengthen oversight.

Auditor General Nancy Gathungu has also questioned the existence of the thousands of accounts in commercial banks, underscoring the growing accountability concerns in the counties.

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• National
• Central Bank of Kenya
• Controller of Budget
• Margaret Nyakang'o
• county governments
• commercial banks
• public funds
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